Restaurants Using Credit Card As Their Loyalty Card

Written by Evan Schuman
April 3rd, 2008

A series of restaurant chains—including Subway, Tully’s and Brinker (Chili’s, Macaroni Grill, On The Border, etc.)—have been experimenting with a way to use regular credit and debit cards as loyalty cards.

Although the merchant behind the program—Chockstone—stresses a variety of security mechanisms, the nature of the program itself seems to fly in the face of PCI guidelines that discourage using credit card numbers for anything other than payment transactions, similar to the unsuccessful attempts to get American businesses to stop using Social Security numbers as defacto employee and customer identification numbers.

The program, which Chockstone calls SingleSwipe, is supposed to replace the loyalty card and make the tracking capabilities more complete, as customers are much more likely to forget a loyalty card than their payment method.

All of the loyalty information is processed and stored at Chockstone facilities, meaning that the retailer doesn’t need to store it in their systems. Even Chockstone doesn’t know the original credit card number as it’s using a one-way hash. "We don’t actually store the credit card number," said Chockstone CEO Jeff Lipp.

Like any traditional CRM/loyalty program, this allows for employees to be given chain-wide information about that customer. With Brinker, for example, Chockstone’s system prints out a special receipt for the greeter and it reveals the customer’s buying history and whether they are a first-time visitor and if they’d ever visited other stores in the chain.

On a receipt for a consumer who had just used a Visa card was a note: "Use a MasterCard on your next purchase and receive 50 cents off."


One Comment | Read Restaurants Using Credit Card As Their Loyalty Card

  1. Walt Conway Says:

    While personally I am not too happy about using a Primary Account Number (PAN) as the basis for a loyalty program, so long as it is hashed it should pass muster with PCI. The question is how secure is the particular hash used. Some algorithms/transformations are more secure (read “less reversable”) than others. The risk, of course, is that the Chockstone database of hashed PANs could be one very tempting target for the bad guys.


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